Dave Gram is reporting for the Associated Press out of Montpelier, Vermont that a “group of dairy farmers is suing four milk marketing firms, saying they’ve engaged in monopolizing the market into which farmers have had to sell milk, fixed prices and created an economic crisis in the Northeast dairy industry.”The class-action suit names the Dairy Farmers of America (based out of Kansas City) and Dean Foods Co. (out of Dallas) as the defendants. Additionally, the Dairy Marketing Services and HP Hood were names as defendants. A spokeswoman for Hood called the allegations in the suit ‘“without basis.”’
“The suit alleges DFA and Dean have seized effective control of the region's dairy industry and are forcing farmers to join DFA or its marketing affiliate Dairy Marketing Services to survive.” The firm representing the farmers, Cohen Milstein, expects many more farmers will join the class-action suit. Since the suit is a class-action, thousands of dairy farmers ‘“similarly situated”’ to the two farm families who brought the suit could collect if the jury reaches a verdict in their favor.
According to Cohen Milstein attorney Benjamin Brown, the plaintiffs don’t know how many farmers will be affected by the suit, but he did note that Dean and Hood “bottle about 90 percent of the fluid milk sold in the Northeast [.]” Brown also argues that current dairy crisis involving milk-pricing is attributable to actions of the defendants.
Brown states in the AP story that ‘“Monopolization and price-fixing have contributed to the milk-pricing crisis dairy farmers, especially small, family-owned dairies in the Northeast, face today . . . Many dairy farmers have been forced to choose between joining DFA or DMS or going out of business . . . If they join, they have to pay a fee to continue to market to their own customers at prices fixed by DFA, DMS and other cooperatives. Meanwhile major milk processors Dean and HP Hood, which is part-owned by DFA, enjoy the economic benefits.”’
In the summer of Dairy discontent, another story emerges.
To read the AP story click here.
Posted: 10/12/09
